The Lemon Fool

Toward the end of the last financial year I decided to use my remaining allowance in my S&S ISA (Halifax Sharedealing). I transferred £8K in on Friday April 3rd using their debit card funding mechanism. However, I didn't notice until recently that the corresponding transaction in my HSBC bank account didn't post to the account until April 6th, which places that side of the transaction in the current financial tax year. Since then, and before noticing this situation, I've actually max'd out my S&S ISA subscription for the current year; therefore, if you take the transaction dates from the HSBC current account then it looks like I've oversubscribed. However, the Halifax side is fine. Has anyone else made this error before? And if you did, did you bring it to the attention of HMRC, etc?

My guess would be that you're OK, if Halifax regards you as having made the deposit in time in the previous financial year. I'd regard it as not much different to you having made a deposit by cheque, with the money showing as having been received in your ISA on a particular date, but the cheque withdrawal then not actually showing up in your bank account until a few days later?

(In fact, for a debit card, it's possibly more like Visa/Mastercard paid the funds in "instantly" (for some value of instantly), and it just takes some time for the "paperwork" to catch up with you for you to have to meet your bank account's agreed obligations to Visa/Mastercard to pay them the money that you owe them for having paid on your behalf? However, you instructed them to pay for you in the previous financial year, and they did.)

Yeh I think you are right Dave. Ultimately the accounting for the ISA is done by Halifax, and it definitely shows up on their system as being in the same tax year as when I initiated the payment. So I'm probably worrying over nothing. Lesson learned though; in any future years where I'm approaching the end of the tax period, I'll make sure I'm not quite so close to the cutoff point when doing the funding!

When I did it some years back, I informed the provider and they rolled back the transaction with no fuss. I don't think I told HMRC.

The ISA managers provide HMRC with information.

JohnB wrote:When I did it some years back, I informed the provider and they rolled back the transaction with no fuss. I don't think I told HMRC.

Yes, the way it invariably works with any kind of trade is that it is the trade date that counts, not the settlement date.

So even if you just place a trade over the phone with no payment, it should stand for that date. Unless ISAs work differently from everything else and require payment in full on that date, but that is news to me if it is the case.

See https://www.gov.uk/guidance/close-void- ... epair-void but in this case it would appear the ISA Subscription was made as intended.